LexisNexis® Legal Newsroom
    Mealey's Insurance - Illinois Federal Judge Says Disability Insurer Reasonably Terminated Benefits

    CHICAGO - A disability insurer did not breach its contract or act unreasonably by terminating a claimant's total disability benefits because the evidence shows that the claimant was able to undertake a number of mentally and physically demanding activities, an Illinois federal judge said Sept. 14 (Henry G. Fiorentini v. Paul Revere Life Insurance Co., No. 15-3292, N.D. Ill., 2017 U.S. Dist. LEXIS 149392).

    Mealey's Insurance - Judge: No Directors, Officers Liability Coverage Owed For Overtime Pay Dispute

    SHERMAN, Texas - A Texas federal judge on Sept. 18 adopted a magistrate's report that recommended granting an insurer's motion for summary judgment in a dispute over directors and officers liability coverage for underlying claims that the insured failed to pay overtime and improperly categorized employees as "exempt" under the Fair Labor Standards Act (ADI WorldLink, LLC v. RSUI Indemnity Co., No. 16-665, E.D. Texas, 2017 U.S. Dist. LEXIS 150505).

    Mealey's Insurance - Ohio Couple Sentenced, Ordered To Turn Over Home For Insurance Fraud

    COLUMBUS, Ohio - A federal judge in Ohio on Sept. 18 sentenced a couple who owned a home health care company for their roles in an insurance fraud scheme that involved submitting falsified training sheets for nurses and aides and required them to turn over the $1 million home they built with the proceeds of their activities (United States of America v. Riyad Altallaa, et al., No. 16cr128, S.D. Ohio).

    Mealey's Insurance - Award Of Attorney Fees Warranted As Disability Claimant Achieved Some Success

    SAN FRANCISCO - A California federal judge on Sept. 14 awarded a disability claimant more than $100,000 in attorney fees after determining that the award was warranted because the claimant achieved "some degree" of success on the merits (Robert Bosley v. Metropolitan Life Insurance Co., No. 16-00139, N.D. Calif., 2017 U.S. Dist. LEXIS 149453).

    Mealey's Insurance - Pediatric Firm Can Pursue Federal, State False Claims Act Allegations, Judge Says

    NEWARK, N.J. - A firm of pediatric doctors can pursue allegations that a skilled nursing and rehabilitation facility violated the False Claims Act, the New Jersey False Claims Act (NJFCA) and the New York False Claims Act (NYFCA) for unlawfully billing Medicare and Medicaid as primary payers rather than a patient's private insurance company, a federal judge in New Jersey ruled Sept. 18, finding that the firm sufficiently stated claims under Federal Rule of Civil Procedure 12(b)(6) (United States of America v. Wanaque Convalescent Center, et al., No. 14-6651, D. N.J., 2017 U.S. Dist. LEXIS 150566).

    Mealey's Insurance - 1st Circuit Allows Negligence Claims Against U.S. In Oil Spill Coverage Dispute

    BOSTON - The First Circuit U.S. Court of Appeals on Sept. 15 reversed a district court's dismissal of admiralty and maritime negligence claims filed against the United States in an oil spill dispute after determining that the negligence claims are viable under the Suits in Admiralty Act (Ironshore Specialty Insurance Co., et al. v. United States of America, et al., No. 16-1589, 1st Cir., 2017 U.S. App. LEXIS 17928).

    Mealey's Insurance - Company Awarded Judgment After Expert For Insurer Seeking Subrogation Excluded

    GREENBELT, Md. - A Maryland federal judge on Sept. 15 awarded summary judgment to a utility contractor on an insurance company's claim that the contractor's negligence caused a house fire, after excluding the insurer's expert from testifying about the standard of care for the work at issue due to lack of a reliable methodology (American Strategic Insurance Corp. v. Scope Services, Inc., No. 15-2045, D. Md., 2017 U.S. Dist. LEXIS 149789).

    Mealey's Insurance - Insurer Is Responsible For 25 Percent Of Lead-Paint Judgment, Federal Judge Says

    BALTIMORE - A Maryland federal judge on Sept. 14 said an insurer is responsible for paying for 25 percent of a judgment entered against its insured in an underlying lead-paint injury case after determining that the allocation must be calculated based on the time period during which the tenant lived in the insured's property (Pennsylvania National Mutual Casualty Insurance Co., v. Jacob Dackman & Sons LLC, et al., No. 16-2640, D. Md., 2017 U.S. Dist. LEXIS 148907).

    Mealey's Insurance - Federal Judge Refuses To Dismiss Diminished Value Suit Arising From Hail/Wind Damage

    MACON, Ga. - A Georgia federal judge on Sept. 15 denied a homeowners insurer's motion to dismiss a lawsuit alleging that it committed breach of contract by refusing to assess and pay for the diminished value of the insureds' home caused by wind and/or hail damage (Tonya Long v. State Farm Fire and Casualty Co., No. 17-28, M.D. Ga., 2017 U.S. Dist. LEXIS 149594).

    Mealey's Insurance - No Professional Liability Coverage Owed For Harassment, Discrimination Claims

    NEWARK, N.J. - A New Jersey federal magistrate on Sept. 14 found that professional liability insurance coverage was not triggered because underlying sexual harassment and discrimination claims do not arise out of the insured's performance of ambulance services, granting the insurer's motion for judgment on the pleadings in the insured's declaratory judgment lawsuit (Aaron Ambulance Medical Transportation Inc., et al. v. Certain Underwriters at Lloyd's, London, No. 16-04564, D. N.J., 2017 U.S. Dist. LEXIS 149409).

    Mealey's Insurance - Appeals Panel Addresses Defamation Claims Against Former N.Y. Attorney General

    NEW YORK - American International Group Inc.'s (AIG) former chief executive officer sufficiently alleged a defamation claim based on several public statements made by New York's former attorney general, a New York appeals panel affirmed Sept. 13 (Maurice R. Greenberg v. Eliot L. Spitzer, No. 1436/13, N.Y. App. Div., 2nd Dept., 2017 N.Y. App. Div. LEXIS 6422).

    Mealey's Insurance - 3rd Circuit Affirms Dismissal Of Insurer's Fraud Suit Against Attorneys, Firm

    PHILADELPHIA - A federal judge in Pennsylvania did not err when dismissing an insurance company's claims that two attorneys and their law firm conspired to submit two fraudulent insurance claims for damage at a church, a Third Circuit U.S. Court of Appeals ruled Sept. 15, finding that the insurer's claims were barred by judicial privilege (Church Mutual Insurance Company v. Alliance Adjustment Group, et al., No. 16-3302, 3rd Cir., 2017 U.S. App. LEXIS 17864).

    Mealey's Insurance - Suit Involving Tenant Rights Triggered Insurer's Duty To Defend, Judge Rules

    HOUSTON - A Texas federal judge on Sept. 13 found that an underlying lawsuit alleging that an insured failed to timely negotiate a commercial lease agreement triggered an insurer's duty to defend, granting the insured's motion for summary judgment in a coverage dispute (2200 West Alabama, Inc v. Western World Insurance Co., No. 16-2244, S.D. Texas, 2017 U.S. Dist. LEXIS 148492).

    Mealey's Insurance - Bad Faith, Breach Of Contract Claims Dismissed; Policy Was Canceled Before Fire Loss

    BIRMINGHAM, Ala. - An Alabama federal magistrate judge on Sept. 13 dismissed an insured's suit seeking coverage for fire damage to the insured's home after determining that the insured's claims for breach of contract and bad faith cannot stand because the evidence shows that the policy at issue was canceled before the fire occurred (Elizabeth Davis v. State Farm Fire and Casualty Co., No. 15-2226, N.D. Ala., 2017 U.S. Dist. LEXIS 147897).

    Mealey's Insurance - Reinsurer Opposes Motion To Bar Employee's Testimony In Asbestos Coverage Dispute

    UTICA, N.Y. - In a dispute over an underlying $325 million settlement of asbestos claims, a reinsurer responds in a Sept. 13 opposition brief to an insurer's motion to exclude testimony from the reinsurer's former employee, arguing to a New York federal court that the former employee has extensive knowledge regarding reinsurance practices, policies and procedures (Utica Mutual Insurance Co. v. Fireman's Fund Insurance Co., No. 09-cv-00853, N.D. N.Y.).

    Mealey's Insurance - Judge Refuses To Strike Class Allegations, Finds UCL Claims Are Representative

    SAN FRANCISCO - Since a construction company seeks to assert claims for violation of California's unfair competition law (UCL) as representative claims under state law, rather than as class claims under federal law, a California federal judge on Sept. 12 denied an insurer's motion to strike parts of the company's complaint filed against it in relation to its issuance of general liability insurance policies (Albert D. Seeno Construction Company, et al. v. Aspen Insurance UK Limited, No. 17-cv-03765, N.D. Calif., 2017 U.S. Dist. LEXIS 147646).

    Mealey's Insurance - Federal Judge Says Amount In Controversy Could Exceed $75,000 If Bad Faith Is Proven

    CAMDEN, N.J. - Although an insured's claim for breach of contract does not exceed the federal jurisdictional minimum amount in controversy of $75,000, a New Jersey federal judge on Sept. 12 refused to dismiss the insured's complaint, noting that if the insured is successful in proving that the insurer acted in bad faith in handling an underinsured motorist claim, the amount in controversy could exceed $75,000 (Beth Gussman v. Government Employees Insurance Co., No. 16-8563, D. N.J., 2017 U.S. Dist. LEXIS 146995).

    Mealey's Insurance - Repopulation Of Bird Flock Lost In Avian Flu Outbreak Is Covered Under Policy

    MINNEAPOLIS - A Minnesota federal judge on Sept. 12 determined that an insured is entitled to reimbursement for the costs of repopulating its bird flock after an outbreak of the avian flu virus required the flock to be destroyed because the destruction of the birds qualifies as a remediation expense as it is damaged property (Rembrandt Enterprises Inc. v. Illinois Union Insurance Co., No. 15-2913, D. Minn., 2017 U.S. Dist. LEXIS 147030).

    Mealey's Insurance - 5th Circuit Finds Woman Was Deliberately Ignorant Of Medicare Fraud Scheme

    NEW ORLEANS - A woman was properly convicted and sentenced to 140 months in prison for illegally billing Medicare more than $250,000 for medical equipment for beneficiaries that was not medically necessary, a Fifth Circuit U.S. Court of Appeals panel ruled Sept. 13, finding that she was deliberately ignorant of her scheme (United States of America v. Tracy Richardson Brown, No. 16-30933, 5th Cir.).

    Mealey's Insurance - Appellate Panel Refuses To Rehear Plan's Arguments In Disability Benefits Suit

    WASHINGTON, D.C. - A District of Columbia Circuit U.S. Court of Appeals panel on Sept. 11 refused to reconsider its finding that a woman was totally disabled under the terms of her Employee Retirement Income Security Act-governed long-term disability plan and that the plan administrator did not satisfactorily supported its conclusion that she was ever capable of full-time work after November 2007 (Jill Marcin v. Reliance Standard Life Insurance Co., et al., No. 16-7125, D.C. Cir., 2017 U.S. App. LEXIS 17551).

    Mealey's Insurance - Kansas Federal Judge Allows Insured To Add Breach Of Contract, Bad Faith Claims

    WICHITA, Kan. - An insured seeking coverage for hailstorm damage to two commercial buildings is permitted to amend its complaint to add claims for breach of contract and bad faith because the addition of the claims would not be futile and the insurers will not be prejudiced as a result of the amendment, a Kansas federal judge said Sept. 8 (Flex Financial Holding Co. v. OneBeacon Insurance Group LLC et al., No. 15-7205, D. Kan., 2017 U.S. Dist. LEXIS 145349).

    Mealey's Insurance - Underlying Suit Fails To Trigger Professional Liability Coverage, Federal Judge Says

    PHILADELPHIA - A senior federal judge in Pennsylvania on Sept. 12 granted two professional liability insurers' motions for judgment on the pleadings and/or summary judgment in a coverage dispute over an underlying negligence lawsuit brought against the insureds by a national title insurance underwriting company (Fidelity National Title Insurance Co. v. Maxum Indemnity Co., et al., No. 16-1360, E.D. Pa., 2017 U.S. Dist. LEXIS 147134).

    Mealey's Insurance - Judge Refuses To Transfer Dispute Under Reinsurance Agreement's Forum Clause

    BRIDGEPORT, Conn. - In a dispute over a series of insurance and reinsurance contracts, a Connecticut federal judge on Sept. 12 declined to enforce a forum selection clause in a reinsurance participation agreement (RPA) because it does not apply to the bulk of an insured's claims against its workers' compensation insurer and its affiliates (Charter Oak Oil Co. Inc. v. Applied Underwriters Inc., et al., No. 17-00689, D. Conn., 2017 U.S. Dist. LEXIS 147181).

    Mealey's Insurance - Judge: Insureds Sufficiently Allege Insurer Considered Higher Reinsurance Costs

    PHILADELPHIA - A class of owners of life insurance policies adequately alleged that a life insurer's admitted consideration of lower investment income and higher reinsurance costs constituted breaches of the policies, a Pennsylvania federal judge ruled Sept. 11 (In re: Lincoln National Co. Litigation, No. 16-06605, E.D. Pa., 2017 U.S. Dist. LEXIS 146904).

    Mealey's Insurance - Judge Finds Anti-Assignment Clause Puts Health Care Insurance Spat Outside ERISA

    NEWARK, N.J. - A health insurance plan's provision barring insureds from assigning rights leaves a provider pursuing its individual right to payment under state law and precludes removal and preemption under the Employee Retirement Income Security Act of 1974, a federal judge in New Jersey held Sept. 11 (Progressive Spine & Orthopaedics LLC v. Anthem Blue Cross Blue Shield, No. 17-536, D. N.J., 2017 U.S. Dist. LEXIS 147466).